Netflix has shut down a major game development studio in Southern California before it was ever able to release a single title. The news was first reported by Game File and confirmed by Netflix.
The studio, informally known as ‘Blue,’ was founded in 2022 and had been working on a AAA multi-platform game based on an original IP. While we never knew anything about the project beyond that, Netflix had been assembling an impressive list of veteran developers to work on it. This includes former Overwatch boss Chacko Sunny in 2022, and, in the following year, original Halo writer and cinematics director Joseph Staten and God of War art director Rafael Grassetti.
It’s unclear exactly why Netflix axed the studio before it could even release its project or where the displaced developers will go next. That said, this speaks to the larger difficulties surrounding AAA game development, especially when it comes to new players from outside of gaming entering the industry in a big way.
The most notable example of this was Google with its now-shuttered Stadia streaming service. In October 2019, Google opened a Montreal-based studio led by veteran Canadian producer Jade Raymond (Assassin’s Creed, Watch Dogs), which was set to create a new IP for Stadia, only for the Android maker to shutter the team just over a year later. Stadia itself ultimately shut down in January 2023.
Amazon, meanwhile, has had its own struggles in trying to break into gaming, with multiple projects being cancelled. That said, its longest-running game, the PC MMO New World, has maintained a solid player base since 2021 and even just launched on PlayStation 5 and Xbox Series X/S under the name of New World: Aeternum.
Netflix, for its part, has taken a gradual approach to gaming. In November 2021, the company launched Netflix Games as a mobile-only offering with dozens of games included at no additional cost with subscriptions. By the end of 2023, the company had reached nearly 100 games on the platform, including popular titles like Hades, Immortality, Monument Valley and Montreal-based Tribute Games’ TMNT: Shredder’s Revenge. It’s also been testing streaming to TVs, PCs and Macs.
While some reports have pegged the Netflix Games audience to be quite low, co-CEO Greg Peters said in a July earnings call that the gaming platform’s performance has actually been exceeding expectations. The company is bullish on the market as a growth opportunity but has noted that its “investment level in games relative to our overall content spend is also quite small” for now.
Interestingly, the news of Netflix’s Blue studio closure comes just one week after Jeet Shroff, formerly vice president of game development at Epic Games, had joined Netflix in the new role of VP over games tech and portfolio development. According to Business Insider, Shroff is tasked with “promoting consistency across its portfolio of games, both licensed and homegrown.” It remains to be seen what will come of his appointment and Netflix’s other gaming ventures amid Blue’s closure.
Source: Game File
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